Budget picture looks dim

South Carolina's budget picture for 2011-2012 and the General Assembly's efforts to solve an $829 million gap are already getting bad reviews. It's going to be a tough year, for lawmakers and for citizens, as we continue to cope with declining revenues, increasing expenses and the numerous constituencies who say, "Cut what you want to cut but leave my agency alone." There's already been some of that, according to Sen. Hugh Leatherman, R-Darlington and Florence counties, chairman of the Senate Finance Committee.

The challenges lawmakers face this year prompted Rep. Dan Cooper, R-Anderson County, chairman of the House Ways and Means Committee, to admit to a roomful of journalists that sometimes — more frequently than ever — he doesn't like his job very much. Although we're sympathetic, we're glad Cooper is the one with the job. He seems up to the task.

"There are no easy answers," Cooper said Thursday in Columbia at a legislative preview sponsored by the South Carolina Press Association. But answers won't be coming from taking any of the recommendations of the Tax Realignment Commission (TRAC) report released in December. "I haven't seen anything in that report that will be introduced by any member of the legislature," Cooper said, words echoed by most of his colleagues. That's because many of its recommendations involve that phrase that strikes fear in the heart of lawmakers: raising taxes.

Leatherman put the idea of that possibility firmly to rest early in the day. "There will be no tax increases, absolutely not," he said. All that is left is to "use the dollars we have as wisely as we can," he said, adding that there will be some "merging and closing of agencies before we get through."

Cooper is right in his assertion that few lawmakers would have a taste for following TRAC's recommendations. There may, however, be some takers among Democrats, including Rep. Harry Ott, D-Lexington and Orangeburg counties, who insists that the almost $1 billion hole comes not strictly from the downturn in the economy but from "poor planning" in the General Assembly. "We've seen this train wreck on the track for a long time. … (It's) the result of tax benefits to the richest people in the state over and over."

Rep. Gilda Cobb-Hunter, D-Orangeburg, was typically frank. It's interesting, she said, that the panelists (at the SCPA meeting) were adamant about no tax increases but failed to mention any new revenue sources. "We're delusional if we think we haven't raised taxes," she insisted. "We're just calling them fees and assessments and fines."

Other lawmakers say that they are doing the bidding of their constituents by making that pledge. "My constituents want me to resist the ‘triple t' — the temptation to tax," said Sen. Harvey Peeler, R- Spartanburg, York and Union counties. When asked what would be the first things to be cut, Peeler responded that a better question is what will be the last. It's unlikely there will be many agencies — or residents — who aren't affected by cuts.

Most of the cuts will be applied in three areas, Rep. Kenny Bingham, R-Lexington County, said. Education, health care and law enforcement are all under more scrutiny because funding for those areas takes up most of the state budget. "They cannot absorb all the money (90 percent of the budget by his assessment) and not be part of solving the problem. Everything has to be on the table."

One area in which there was near-unanimous agreement was that job creation and economic development must be at the top of everyone's agenda. We couldn't agree more.

Also a priority should be finding a better way to fund public education. TRAC did not include a recommendation to revisit Act 388, much to our disappointment, but it's apparently a moot point. As several lawmakers pointed out, and as we were reminded when we re-read the legislation that set up the commission in the first place, its final product would require an up or down vote: all or nothing. That doesn't mean, however, that portions of its recommendations shouldn't come out in future proposals. (Act 388 decreed public schools would be funded by sales taxes instead of property taxes. Lawmakers also created a trust fund in case taxes didn't come in as expected –– and they didn't. That's money that could have stemmed some of the problems in education and other equally important agencies.)

In the weeks to come, we'll be taking a look at the progress of budget talks and efforts to improve our economy, as well as what the future holds for services — or the lack of them. But we would remind Bingham and other lawmakers to keep in mind that the reason education, health care and law enforcement make up the primary bulk of the budget is because it would be difficult to find any citizen of this state not affected in one or more of those areas. Although it is going to be hard to reconcile need with reality, they are among the state's most basic responsibilities to its citizens.

Thus we can no more ignore the health of those areas than we can ignore the financial health of our state.